Clare Daly (Dublin North, Socialist Party) | Oireachtas source

I am still in shock at the contributions from certain Government backbenchers who claim this is a great budget and that the Minister grappled creatively with the issues in these difficult times. Supposedly we are all making sacrifices and are about to turn a corner. The reality is that the times have not been hard for all of us and the times will not be hard for those who again escaped the measures in this budget. I want to speak not only about what is contained in the budget but also the decisions that were not made. It is clear that the taxation elements of the budget reflect a strategic decision to ensure those who are wealthy remain wealthy and that the State does not play a role in income distribution. The budget has in fact been a mechanism for perpetuating inequality.

The Government could have considered several different measures that would have altered the situation for the better. It is conservatively estimated that a tiny tax of 1% on wealth over €1 million would generate between €300 million and €700 million, compared to the €400 million taken through the hated home tax. An increase of 1.5% in income tax for the top 10% would yield €400 million. The Government makes great virtue of the fact that corporation tax has remained untouched. I do not celebrate that. If we implemented the effective rate of corporate taxation, which is already among the lowest in Europe, we could generate an extra €2.3 billion per annum. If we raised it to the European average we could generate €7 billion. Cutting tax relief on pensions to the standard rate of 20%, as was recommended by Social Justice Ireland, could yield €500 million. The majority of beneficiaries of that tax relief are in the top 20% of earners. Implementing any or all of these measures would have allowed the Government to reverse some of the cuts of previous years and stimulate economic activity.

The only way this society and economy will recover is through job creation. The idea that job creation will come from this budget is laughable. We know the €500 million tax relief package is not going to work because we had the same thing last year. The targets proposed are always greater than what is delivered at the end of the day because of the need to rely on the private sector. We do not know how much activity would have taken place anyway. The home renovation scheme is a good example of that. The Government had to move the date forward because a considerable number of people cancelled orders with builders to reschedule the work for the new year. If we are to stimulate economic growth we need a State-led investment programme of public works. Instead of this, however, the budget introduces one law for ordinary people and another for everyone else. That was exposed in the property tax debacle of the past several weeks, in which respect the Government has lost the hearts and minds of the nation. It may have introduced legislation allowing it to take money from people's pay packets and pensions without their permission but it does not have the same enthusiasm for dealing with white collar crime.

The Minister made some changes to the section 851A of the Taxes Consolidation Act but I do not think he altered the provision inserted into section 77 of the Finance Act 2011, which I have raised in parliamentary questions and the Office of the Director of Corporate Enforcement has repeatedly highlighted in its annual reports. The office has made it clear that the aforementioned section the office prevents it from properly pursuing white collar criminals because they are not allowed to access the information they need from Revenue. The office has asked the Minister to introduce legislative changes to allow it to deal with white collar crime. From my reading of the measures proposed in this Bill, such amendments have not yet been prepared. That goes against open and transparency in taxation matters.

One of the most controversial aspects of this Finance Bill is the assault on separated families and, because of the way these issues work out, separated fathers in particular. A number of Deputies have raised this issue. I note that the Minister has rowed back a bit but it is not enough. He is still discriminating against separated people. When couples separate the costs are immense and they have to deal with emotional and financial difficulties in negotiating maintenance agreements and engaging in responsible parenting. The Minister is attacking them for that. There are many unanswered questions even with his concession. If the principal carer is not working and the allowance is claimed by the other parent, what happens if the principal carer returns to work? What happens where parents share child care on a 50:50 basis? What about families in dispute? There is no doubt that the provision will lead to an avalanche of court cases as people renegotiate or renege on maintenance orders because they cannot afford to undertake their responsibilities. It is socially regressive and I urge the Minister to abandon the proposal and stop discriminating against separated people.

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